A reconciliation of GAAP to non-GAAP net income and EPS is provided in
the tables that follow. Year-to-date results can be found in the
attached tables.

$ in millions, except EPS amounts

Third Quarter

2013

2012

EPS

GAAP EPS

$0.38

$0.56

Difference3

0.54

0.39

Non-GAAP EPS that excludes items listed below1

$0.92

$0.95

Net Income

GAAP net income2

$1,124

$1,729

Difference

1,605

1,203

Non-GAAP net income that excludes items listed below1,2

$2,729

$2,932

Decrease (Increase) in Net Income Due to Excluded Items:

Acquisition-related costs4

$1,196

$1,340

Restructuring costs5

967

163

Net decrease (increase) in income before taxes

2,163

1,503

Income tax (benefit) expense6

(558)

(300)

Decrease (increase) in net income

$1,605

$1,203

“This quarter we delivered solid financial results, with strong
contributions from our vaccine, immunology and HIV businesses, and
effective cost management,” said Kenneth C. Frazier, chairman and chief
executive officer, Merck. “We are improving productivity and focusing
our R&D and commercial resources more precisely to enable our
investments in the best opportunities for innovation and growth. We are
encouraged that our combination hepatitis C regimen has joined our
anti-PD-1 immunotherapy in being designated as a ‘breakthrough therapy’
by the FDA.”

Select Revenue Highlights

Worldwide sales were $11.0 billion for the third quarter of 2013, a
decrease of 4 percent compared with the third quarter of 2012, including
a 2 percent negative effect from foreign exchange.

The following table reflects sales of the company's top pharmaceutical
products, as well as total sales of animal health and consumer care
products.

Sales from emerging markets decreased 4 percent, including a 6 percent
negative impact from foreign exchange. Emerging market sales accounted
for approximately 20 percent of pharmaceutical sales in the third
quarter of 2013 with strong growth in Brazil, Korea, Russia and Turkey,
offset by declines in China and Mexico.

Worldwide sales of the combined diabetes franchise of JANUVIA
(sitagliptin)/JANUMET (sitagliptin and metformin HCI) decreased 1
percent to $1.4 billion in the third quarter, including a 3 percent
negative impact from foreign exchange. Sales decreases in the United
States due to reduced customer inventory levels, and in Japan due to
foreign exchange, were partially offset by growth in Europe and the
emerging markets.

Sales of ZETIA (ezetimibe) and VYTORIN (ezetimibe/simvastatin),
medicines for lowering LDL cholesterol, decreased 1 percent to $1.1
billion in the third quarter, including a 2 percent negative impact from
foreign exchange. The decrease reflects lower sales of VYTORIN,
partially offset by growth of ZETIA, mainly in the United States.

Combined sales of REMICADE and SIMPONI, treatments for inflammatory
diseases, increased 22 percent, including a 6 percent positive impact
from foreign exchange, to $700 million in the third quarter of 2013.

ISENTRESS, an HIV integrase inhibitor for use in combination with other
antiretroviral agents for the treatment of HIV-1 infection, grew 7
percent to $427 million in the third quarter driven by growth in all
regions.

Merck’s sales of GARDASIL, a vaccine to help prevent certain diseases
caused by four types of human papillomavirus (HPV), were $665 million,
an increase of 15 percent for the quarter. The increase was driven by
higher sales in the United States, which reflects continued strong
uptake of use in males, as well as higher public sector sales of
approximately $60 million. The increase was partially offset by lower
sales in Japan due to the government’s decision to suspend proactive
recommendation of HPV vaccines in the country.

Worldwide sales of SINGULAIR, a once-a-day oral medicine for the chronic
treatment of asthma and the relief of symptoms of allergic rhinitis,
declined 53 percent to $280 million in the third quarter. The patents
for SINGULAIR expired in the United States in August 2012 and expired in
major European markets in February 2013. The company has experienced a
significant and rapid reduction in sales in these markets.

Animal Health Revenue Performance

Animal Health sales totaled $800 million for the third quarter of 2013,
a 2 percent decline compared with the third quarter of 2012, including a
2 percent negative impact due to foreign exchange. The quarter was
negatively affected by the previously announced voluntary suspension of
sales of ZILMAX (zilpaterol hydrochloride), the company’s feed
supplement for cattle, in the United States and Canada. The negative
impact was partially offset by higher sales of companion animal and
swine products.

Consumer Care Revenue Performance

Third-quarter global sales of Consumer Care were $443 million, a
decrease of 2 percent compared to the third quarter of 2012, including a
2 percent negative impact due to foreign exchange. Sales were positively
affected by the launch of OXYTROL FOR WOMEN, the only over-the-counter
medicine to treat overactive bladder, but were offset by lower sales in
the DR. SCHOLL’S footcare line.

Other Revenue Performance

Other revenues – primarily comprising alliance revenue, miscellaneous
corporate revenues and third-party manufacturing sales – decreased 9
percent to $315 million compared to the third quarter of 2012. The
decrease was primarily driven by lower revenue from AstraZeneca LP
(AZLP) recorded by Merck, which decreased 14 percent to $220 million as
compared with the third quarter 2012.

Third-Quarter Expense and Other Information

The costs detailed below totaled $9.4 billion on a GAAP basis during the
third quarter of 2013 and include $2.2 billion of acquisition-related
costs and restructuring costs.

$ in millions

Included in expenses for the period

Third Quarter 2013

GAAP

Acquisition-RelatedCosts4

RestructuringCosts5

Non-GAAP1

Materials and production

$4,104

$1,176

$57

$2,871

Marketing and administrative

2,803

20

31

2,752

Research and development

1,660

–-

9

1,651

Restructuring costs

870

–-

870

–-

Third Quarter 2012

Materials and production

$4,137

$1,232

$60

$2,845

Marketing and administrative

3,063

68

25

2,970

Research and development

1,918

40

(32)

1,910

Restructuring costs

110

–-

110

–-

The gross margin was 62.8 percent for the third quarter of 2013 and 64.0
percent for the third quarter of 2012, reflecting 11.2 percentage points
of unfavorable impact in both periods from the acquisition-related costs
and restructuring costs noted above. The gross margin decline, on a
non-GAAP basis, primarily reflects the impact of recent patent expiries.

Marketing and administrative expenses, on a non-GAAP basis, were $2.8
billion in the third quarter of 2013, a decrease from $3.0 billion in
the third quarter of 2012 due to ongoing productivity improvements.

Research and development (R&D) expenses, on a non-GAAP basis, were $1.7
billion in the third quarter of 2013, a decrease from $1.9 billion in
the third quarter of 2012 reflecting ongoing productivity improvements
and timing of certain programs that will begin in the fourth quarter.

Equity income from affiliates was $102 million for the third quarter,
primarily reflecting the performance of partnerships with AZLP and
Sanofi Pasteur MSD.

Other (income) expense, net was $172 million of expense in the third
quarter of 2013, compared to $200 million of expense in the third
quarter of 2012.

The company noted the following developments:

Announced a global, multi-year initiative to sharpen the company’s
commercial and R&D focus, targeting a net reduction in annual
operating expenses of approximately $2.5 billion by the end of 2015.
These savings are off of the company’s full-year 2012 expense levels.

Announced that V503, Merck’s investigational 9-valent HPV vaccine, has
completed its pivotal Phase III clinical trial and has met all primary
study endpoints. Merck will present results from the Phase III
clinical program for V503 at the EUROGIN (EUropean Research
Organisation on Genital Infection and Neoplasia) congress in early
November. The company expects to submit a Biologics License
Application (BLA) for V503 to the FDA in 2013.

Presenting interim data from the Phase IB expansion study evaluating
the efficacy and safety of the company’s anti-PD-1 immunotherapy
(MK-3475) in patients with refractory non-small cell lung cancer
tomorrow, Oct. 29, at 1:15 a.m. EDT, at the 15th World
Conference on Lung Cancer in Sydney, Australia.

Informed by the FDA that the Allergenic Products Advisory Committee
meeting to discuss the BLA for the investigational grass pollen
allergy immunotherapy tablet (AIT) has been rescheduled to Dec. 12,
2013. The Advisory Committee meeting originally scheduled for Nov. 6
was temporarily postponed due to the recent U.S. government shutdown.

Announced the receipt of a Complete Response Letter from the FDA for
the resubmission of the New Drug Application for sugammadex sodium
injection, Merck’s investigational medicine for the reversal of
neuromuscular blockade induced by rocuronium or vecuronium. To address
the Complete Response Letter, the company intends to conduct a
confirmatory hypersensitivity study as soon as practicable, following
discussion about the study with FDA.

Received approval from the FDA to manufacture bulk varicella at the
company’s site in Durham, N.C., for use in Merck’s vaccines to protect
against chickenpox and shingles. The approval will enable the site to
produce bulk varicella supply for the United States and help boost
Merck’s overall global supply capabilities.

Financial Targets

Merck has narrowed the range of full-year 2013 non-GAAP EPS to be
between $3.48 and $3.52, and the 2013 GAAP EPS to be between $1.61 and
$1.79. The 2013 non-GAAP range excludes acquisition-related costs, costs
related to restructuring programs and certain other items.

At current exchange rates, Merck continues to anticipate full-year 2013
sales to be approximately 5 to 6 percent below prior year levels with
foreign exchange accounting for approximately 2.5 percentage points of
the decline.

In addition, the company continues to expect full-year 2013 non-GAAP R&D
expense to be below 2012 levels. The company continues to anticipate its
full-year 2013 non-GAAP tax rate to be in the range of 22 to 23 percent.

A reconciliation of anticipated 2013 EPS, as reported in accordance with
GAAP to non-GAAP EPS that excludes certain items, is provided in the
table below.

$ in millions, except EPS amounts

Full Year 2013

GAAP EPS

$1.61 to $1.79

Difference3

1.87 to 1.73

Non-GAAP EPS that excludes items listed below

$3.48 to $3.52

Acquisition-related costs

$5,400 to $5,200

Restructuring costs

1,900 to 1,600

Net decrease (increase) in income before taxes

7,300 to 6,800

Income tax (benefit) expense7

(1,700) to (1,600)

Decrease (increase) in net income

$5,600 to $5,200

Total Employees

As of Sept. 30, 2013, Merck had approximately 80,000 employees
worldwide. In addition, the company’s joint ventures in China and
Brazil, which are included in the consolidated results of Merck, had
about 1,300 employees.

Earnings Conference Call

Investors, journalists and the general public may access a live audio
webcast of the call today at 8:00 a.m. EDT on Merck’s website at http://www.merck.com/investors/events-and-presentations/home.html.
Institutional investors and analysts can participate in the call by
dialing (706) 758-9927 or (877) 381-5782 and using ID code number
77194196. Members of the media are invited to monitor the call by
dialing (706) 758-9928 or (800) 399-7917 and using ID code number
77194196. Journalists who wish to ask questions are requested to contact
a member of Merck's Media Relations team at the conclusion of the call.

About Merck

Today's Merck is a global healthcare leader working to help the world be
well. Merck is known as MSD outside the United States and Canada.
Through our prescription medicines, vaccines, biologic therapies, and
consumer care and animal health products, we work with customers and
operate in more than 140 countries to deliver innovative health
solutions. We also demonstrate our commitment to increasing access to
healthcare through far-reaching policies, programs and partnerships. For
more information, visit www.merck.com
and connect with us on Twitter,
Facebook
and YouTube.

Forward-Looking Statement

This news release includes “forward-looking statements” within the
meaning of the safe harbor provisions of the United States Private
Securities Litigation Reform Act of 1995. These statements are based
upon the current beliefs and expectations of Merck’s management and are
subject to significant risks and uncertainties. There can be no
guarantees with respect to pipeline products that the products will
receive the necessary regulatory approvals or that they will prove to be
commercially successful. If underlying assumptions prove inaccurate or
risks or uncertainties materialize, actual results may differ materially
from those set forth in the forward-looking statements.

Risks and uncertainties include but are not limited to, general industry
conditions and competition; general economic factors, including interest
rate and currency exchange rate fluctuations; the impact of
pharmaceutical industry regulation and health care legislation in the
United States and internationally; global trends toward health care cost
containment; technological advances, new products and patents attained
by competitors; challenges inherent in new product development,
including obtaining regulatory approval; Merck’s ability to accurately
predict future market conditions; manufacturing difficulties or delays;
financial instability of international economies and sovereign risk;
dependence on the effectiveness of Merck’s patents and other protections
for innovative products; and the exposure to litigation, including
patent litigation, and/or regulatory actions.

Merck undertakes no obligation to publicly update any forward-looking
statement, whether as a result of new information, future events or
otherwise. Additional factors that could cause results to differ
materially from those described in the forward-looking statements can be
found in Merck’s 2012 Annual Report on Form 10-K and the company’s other
filings with the Securities and Exchange Commission (SEC) available at
the SEC’s Internet site (www.sec.gov).

1 Merck is providing certain 2013 and 2012 non-GAAP
information that excludes certain items because of the nature of these
items and the impact they have on the analysis of underlying business
performance and trends. Management believes that providing this
information enhances investors’ understanding of the company’s
performance. This information should be considered in addition to, but
not in lieu of, information prepared in accordance with GAAP. For
description of the items, see Table 2a, including the related footnotes,
attached to this release.

2 Net income attributable to Merck & Co., Inc.

3 Represents the difference between calculated GAAP EPS and
calculated non-GAAP EPS, which may be different than the amount
calculated by dividing the impact of the excluded items by the
weighted-average shares for the period.

4 Includes expenses for the amortization of intangible assets
recognized as a result of mergers and acquisitions, as well as
intangible asset impairment charges. Also includes integration and other
costs associated with mergers and acquisitions.

5 Amounts primarily include employee separation costs and
accelerated depreciation associated with facilities to be closed or
divested related to actions under the company’s formal restructuring
programs. Amount for 2013 includes approximately $545 million of costs
related to actions under a global initiative announced by the company on
October 1.

6 Includes the estimated tax impact on the reconciling items.
In addition, amount for 2013 includes a net benefit of $165 million
related to the settlements of certain federal income tax issues.

7 Includes the estimated tax impact on the reconciling items,
as well as net benefits of approximately $325 million related to the
settlements of certain federal income tax issues.

(1) Amounts include the impact of acquisition-related costs,
restructuring costs and certain other items. See accompanying tables
for details.

(2) Represents separation and other related costs associated with
restructuring activities under the company's formal restructuring
programs. Amounts for the third quarter and first nine months of
2013 include approximately $545 million of costs related to actions
under a global initiative announced by the company on October 1.

(4) Other (income) expense, net in the first nine months of 2013
reflects approximately $140 million of losses due to exchange as a
result of a Venezuelan currency devaluation.

(5) The effective tax rate for the first nine months of 2013
reflects net benefits from the settlements of certain federal income
tax issues, reductions in tax reserves upon expiration of applicable
statute of limitations and the favorable impact of tax legislation
enacted in the first quarter of 2013.

Merck is providing non-GAAP information that excludes certain items
because of the nature of these items and the impact they have on the
analysis of underlying business performance and trends. Management
believes that providing this information enhances investors'
understanding of the company's performance. This information should
be considered in addition to, but not in lieu of, information
prepared in accordance with GAAP.

(1) Amounts included in materials and production costs reflect
expenses for the amortization of intangible assets recognized as a
result of mergers and acquisitions. Amounts included in marketing
and administrative expenses reflect merger integration costs.

(2) Amounts primarily include employee separation costs and
accelerated depreciation associated with facilities to be closed or
divested related to actions under the company's formal restructuring
programs.

(3) Represents the estimated tax impact on the reconciling items, as
well as a net benefit of approximately $165 million related to the
settlements of certain federal income tax issues.

Merck is providing non-GAAP information that excludes certain items
because of the nature of these items and the impact they have on the
analysis of underlying business performance and trends. Management
believes that providing this information enhances investors'
understanding of the company's performance. This information should
be considered in addition to, but not in lieu of, information
prepared in accordance with GAAP.

(1) Amounts included in materials and production costs reflect
expenses of $3.5 billion for the amortization of intangible assets
recognized as a result of mergers and acquisitions, as well as $330
million of impairment charges on product intangibles. Amounts
included in marketing and administrative expenses reflect merger
integration costs. Amounts included in research and development
expenses represent in-process research and development (“IPR&D”)
impairment charges.

(2) Amounts primarily include employee separation costs and
accelerated depreciation associated with facilities to be closed or
divested related to actions under the company's formal restructuring
programs.

(3) Represents the estimated tax impact on the reconciling items, as
well as net benefits of approximately $325 million related to the
settlements of certain federal income tax issues.

Sum of quarterly amounts may not equal year-to-date amounts due to
rounding.

(1) Only select products are shown.

(2) Includes Pharmaceutical products not individually
shown above. Other Vaccines sales included in Other Pharmaceutical
were $53 million, $86 million, and $127 million for the first,
second, and third quarters of 2013. Other Vaccines sales included in
Other Pharmaceutical were $60 million, $75 million, $116 million,
and $69 million for the first, second, third, and fourth quarters of
2012, respectively.

(3) The decrease in Consumer Care sales in the second quarter and
September year-to-date period resulted from the ongoing termination
in China of distribution arrangements and a reversal of sales
previously made to those distributors, together with associated
termination costs.

(4) Other revenues are primarily comprised of alliance revenue,
miscellaneous corporate revenues and third party manufacturing sales.